The study on the development subsidy for companies and the development subsidy for the operational environment evaluates how well the goals set for these subsidies have been achieved and how effective the subsidies are from the viewpoints of companies, the Centres for Economic Development, Transport and the Environment (ELY) and interest groups. In addition, suggestions for the development of the subsidies are given. The focus is on the evaluation of the development subsidy for companies.

The surveys conducted were targeted to companies (n=1022) which have applied for the subsidy, to ELY Centres (n=71) and interest groups (n=97). The data registers of Ministry of Employment and the Economy were also utilized in the analysis. In addition, case studies on the development projects were conducted.

The companies were mostly very satisfied with the development subsidy for companies. The suggestions to improve the scheme were mainly targeted to increasing of customer orientation and flexibility. In addition, more e-services were asked for and the subsidy was suggested to be paid partly in advance. The analysis showed that the industrial companies in the Eastern and Northern Finland are mostly granted for implementing their investment projects, whereas the expert companies in the Southern and Western Finland rather carry out development projects. The aim of the granted projects in the Eastern and Northern Finland is to increase the level of the technology used or the quality of the products or services more often than in companies in other parts of Finland. The subsidy seems to be most significant for growth companies. On the other hand, the effects of the subsidy on improving know-how or networking are quite modest.

How much did the development subsidy for companies effect on the realization of the project? Based on the company responses, the subsidy increased the scale or quality of the project or it advanced the project in 93 % of the cases. The project would not have been implemented without the subsidy by 26 % of the companies. The project would have been implemented unchanged by 7 % of the companies even without the subsidy.

The development subsidy for companies should be targeted better to high-risk projects of small companies. More emphasis should be put on growth, renewal, internationalization and employment. ELY Centres should be more proactive in their search for young and growing companies and encourage them to development projects with higher risks. The nature of the development project – its success criteria and the intended outcomes – should be evaluated in more detail at the ELY Centres. In addition, it is important that the market deficiencies and effects on the competition will be integrated more strongly to the evaluation of the development project.

Often a holistic service and financing solution is designed for the development project at the planning stage. Customer’s understanding of the boundaries between different organizations and different subsidies can easily get blurred in that occasion. In the long run the aim must be the simplification of the Finnish business subsidy system as a whole – both on the level of organizations and measures/schemes. It is essential to increase the cooperation between the actors, which also calls for renewal in local, regional and national cooperation of the policy makers.

The effects of the development subsidy for the operational environment focus on the development of the funded organization itself more than anticipated. Greater attention should be paid on the ways to channel the effects more directly to the local companies and to their operational environment.